2024 -- S 2349

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LC004781

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2024

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A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND HOUSING

AND MORTGAGE FINANCE CORPORATION

     

     Introduced By: Senators Paolino, E Morgan, Quezada, Pearson, Picard, Acosta, Ciccone,
Cano, LaMountain, and Mack

     Date Introduced: February 12, 2024

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 42-55 of the General Laws entitled "Rhode Island Housing and

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Mortgage Finance Corporation" is hereby amended by adding thereto the following section:

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     42-55-31. Revolving fund to assist first-time homebuyers and veterans.

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     (a) There is created, as a separate fund within the treasury, the first-time homebuyers and

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veterans revolving fund (the "revolving fund"). The purpose of this revolving fund is to provide

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assistance to first-time homebuyers and veterans who are buying a home, through a revolving fund.

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The revolving fund shall assist these homebuyers in acquiring sufficient funds for an initial down

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payment on a home in Rhode Island, by providing grants. The revolving fund shall consist of any

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sums that the state may from time to time appropriate, as well as money received from donations,

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gifts, bequests, or otherwise from any public or private source, which money is intended to assist

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with promoting home purchases for first-time homebuyers and veterans. The general assembly shall

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authorize an appropriation of thirty million dollars ($30,000,000) to provide initial funding to

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establish this revolving fund.

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     (b) The treasurer shall contract with the Rhode Island housing and mortgage finance

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corporation (hereinafter sometimes referred to as "RI housing") for the administration and

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disbursement of funds. The Rhode Island housing and mortgage finance corporation shall adopt

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rules and regulations in conjunction with the office of veterans affairs within the department of

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human services as well as with appropriate community groups consistent with the purposes of this

 

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section and chapter 35 of title 42 ("administrative procedures"), which provide for the orderly and

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equitable disbursement and repayment of funds.

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     (c) Funds placed in the revolving fund shall be made available as follows:

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     (1) To make grants to a first-time homebuyer or a veteran purchasing a single-family home

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or condominium in Rhode Island;

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     (2) The maximum price on a home purchase for which a grant may be issued from the

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revolving fund shall be the median single-family house price on the market in Rhode Island as

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determined by the Rhode Island Realtors Association or any successor organization;

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     (3) To be eligible for a grant from the revolving fund, a prospective purchaser shall:

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     (i) Have a minimum credit score of at least six hundred twenty (620);

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     (ii) As part of the application process, complete a homebuyer education course, available

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in person or online through RI housing;

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     (iii) Obtain a RI housing-funded first-mortgage through a participating lender or the RI

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housing Loan Center; and

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     (iv) Occupy the home as their primary residence during the period of the loan repayment.

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     (d) The revolving fund shall provide a dollar-for-dollar match to be used as a down-

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payment up to forty thousand dollars ($40,000).

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     (e) In addition, applicants who qualify for a grant from the revolving fund shall also be

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eligible for a loan from RI housing or its affiliates at a special rate of interest which rate is one

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percent (1%) less than any other loan RI housing is offering to buyers who are not first-time home

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purchasers or veterans. This reduced rate shall remain on the loan until the loan is refinanced, the

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real property is resold, or the loan is repaid in full. This reduced interest rate shall not apply to a

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loan issued or authorized by RI housing or its affiliates which has an interest rate of four percent

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(4%) or less.

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     (f) As used herein, the term "veteran" means a person who served on active duty with the

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U.S. Army, Air Force, Navy, Marine Corps, or Coast Guard, for a minimum of one hundred eighty

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(180) days and who was discharged or released under conditions other than dishonorable.

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Reservists or members of the National Guard called to federal active duty (for other than training)

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or disabled from a disease or injury incurred or aggravated in the line of duty or while in training

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status also qualify as a veteran pursuant to 38 C.F.R. part 74.

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     SECTION 2. This act shall take effect on July 1, 2024.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND HOUSING

AND MORTGAGE FINANCE CORPORATION

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     This act would establish a revolving fund to assist first-time homebuyers and veterans to

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purchase a home in Rhode Island by issuing grants of up to forty thousand dollars ($40,000). The

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revolving fund would be administered by the Rhode Island housing and mortgage finance

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corporation. This act would also authorize the Rhode Island housing and mortgage finance

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corporation to issue low interest loans to applicants who qualify for the grants. The act would also

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provide for an initial appropriation of thirty million dollars ($30,000,000) to establish the revolving

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fund.

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     This act would take effect on July 1, 2024.

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